Germany Becomes Solar Hot Spot

It may not be the sunny outback or on the sun-kissed Med but this has not stopped Germany from becoming the leader in solar power generation.

New government initiatives to increase the use of renewables - such as photovoltaic power from 13% to 27% by 2020 - have benefited energy companies operating in this market, according to a report by the German Institute for Economic Research (GIER).

At present, the US is almost five years behind Germany in its solar industry and this is predicted to rise if the cost of fossil-fuels increases.

According to Rhone Resch, the President of the Washington-based Solar Energy Industry Association, the market is still predicting $25bn revenues in the next five years.

"The US market is starting to wake up," Resch says.

The GIER has, however, warned of the importance of current policies – saying any changes to how regulations and subsidies are governed could be disastrous for Germany's efforts to move forward.

Report author Claudia Kemfert says that Germany's solar industry could be getting too used to subsidies, and without these, it might not be dynamic enough to keep driving forward.

"The major point of criticism says that [solar] is too far from being competitive," Kemfert says.

Presently, utilities pay €0.51 per kW/h for solar, while they charge €0.20 cents per kW/h, with consumers paying an extra €0.5 per kW/h to fund green energy.

Germany produces 55% of the world's photovoltaic energy with solar panels operating between the Baltic Sea and Black Forrest.

Reported by Penny Jones